Globe Telecom Inc. · PSE:GLO
Globe Telecom — Q4 2005 Earnings Presentation
14 slides from Globe Telecom's earnings presentation, Feb 9, 2006
Slide 1: Globe Telecom, Inc. Investors' Briefing
GLOBE TELECOM, INC. Investors’ Briefing February 9, 2006 1 1 Highlights Robust Performance in Q4 Paves Way for 2006 ! Healthier Gross Adds, while Churn Improved ! Improved ARPUs, ARPUs, with Increase in Usage and Lower SAC ! Continuing Improvement in Financial Performance 2 2 1
Slide 2: Healthier Gross Adds, while Churn Improved
Healthier Gross Adds, while Churn Improved Gross & Net Additions (in ‘000) Churn Rate 16.0% 5,000 14.0% 14.0% 3,832 11.6% 4,000 12.0% 2,780 2,917 2,802 10.2% 3,000 10.0% 8.4% 8.1% 2,095 8.3% 8.2% 2,000 8.0% 1,000 800 671 6.0% 5.2% 4.6% 4.4% 6.7% 442 3.2% 0 4.0% 2.6% (6) 1.8% 1.8% 2.0% (1,000) (1,218
Slide 3: Strong Uptake for Services
Strong Uptake for Services Service Revenues (in Php Million) Total SIM Base (in ‘000) 15,000 16,000 14,629 14,000 13,627 12,956 12,409 12,514 12,404 14,000 12,000 13,647 13,540 13,454 13,274 10,000 13,000 8,000 6,000 12,000 4,000 2,000 11,000 0 4Q04 1Q05 2Q05 3Q05 4Q05 TM 1,698 2,122 2,554 2,568 3,1
Slide 4: 2005 Net Income 9% Below 2004, as Expenses and Taxes Grew Faster
2005 Net Income 9% Below 2004, as Expenses and Taxes Grew Faster than Revenues (in PhP bn) • Consolidated service revenues up 4% to P54.9bn 60.0 • Net income down 9% at P10.3bn 52.7 54.9 50.0 ! Provisions for income tax almost tripled, with the expiry 40.0 of IT holiday and Innove reverting to regul
Slide 5: Key Drivers of Momentum: Attractive Value Offers
Key Drivers of Momentum: Attractive Value Offers In December 2005, we led the market with the launch of our most radical tariff offer to date – Per Second Charging P0.10 /second - for all Globe-to-Globe and TM-to-TM calls - promo extended to February 14, 2006 due to positive response from our subscr
Slide 6: Wireline Business – Continuing to Grow Market Presence
Wireline Business – Continuing to Grow Market Presence Wireline Service Revenues (in Php m) 2005 2004 % Change Total Subscribers 362,143 323,094 12% 7,000 5,687 6,416 Broadband Subscribers 22,479 7,780 189% 6,000 2,020 5,000 1,742 4,000 Service Revenues (in P m) 6,416 5,687 13% 3,000 +13% 2,000 3,94
Slide 7: Continuing to Lead the Pack: Globe's Many Firsts in 3G
Aggressive Wireline Initiatives to Establish Market Presence Largest WiFi Hotspot footprint, now covering over covering 236 outlets 13 13 Continuing to Lead the Pack . . . Globe’s Many Firsts in 3G ! July ’05 - First to be granted 3G trial license by the NTC - First to conduct video call over mobile
Slide 8: 2006 Will Not Be Without Challenges…
2006 Will Not Be Without Challenges… ! Continued challenge in macro- macro-economic environment ! Continued price and margin pressures ! Deregulation of VOIP market ! Impending launch of 3G 15 15 Our Robust Q4 Results Provide Positive Momentum Moving Forward… Our focused efforts on executing improve
Slide 9: Globe in 2006: Building on our Growth Momentum
Globe in 2006: Building on our Growth Momentum 1. 1. Pricing Pricing Competitiveness Competitiveness 2. 2. Consumer Consumer Value Value Propositions Propositions 3. 3. Product Product Innovations Innovations 4. 4. Cost Cost Management Management 5. 5. New New Revenue Revenue Streams Streams 6. 6. B
Slide 10: Service Revenues up 4%, higher costs and taxes reduce Net Income by 9%
Service Revenues up 4%, higher costs and taxes reduce Net Income by 9% In Million Pesos Wireless Wireline 2005 2004 % Increase Service Revenues 48,481 6,416 54,897 52,741 4% Operating Expenses & Subsidy (19,533) (3,392) (22,925) (19,846) 16% EBITDA 28,948 3,024 31,972 32,895 -3% Depreciation & amort
Slide 11: EBITDA and EBIT improved quarter-on-quarter in pace with revenue growth
EBITDA and EBIT improved quarter- quarter-on- on- quarter in pace with revenue growth EBITDA (in P millions) EBIT (in P millions) 12,000 70% 7,000 32% 35% 59% 57% 60% 60% 30% 29% 30% 56% 60% 6,000 28% 30% 10,000 8,816 8,118 8,081 50% 5,000 4,668 25% 7,603 7,472 4,145 8,000 4,060 3,852 3,657 40% 4,00
Slide 12: Enhanced network coverage … Healthy Leverage Profile
Enhanced network coverage … Network Roll- Roll-out 6,000 Cell Sites 5,159 5,000 ! Cell site count reached 5,159 3,736 4,000 ! 1,423 new cell sites in 2005 3,000 2,580 2,190 1,782 ! Enhanced Network Coverage 2,000 ! 93% of total municipalities 1,000 ! 97% of population 0 2001 2002 2003 2004 2005 35.0
Slide 13: Debt Maturity Profile; EPS and ROE declined with lower net income
Debt Maturity Profile (in US$ m) 500 415 400 300 200 148 148 130 95 100 0 2006 2007 2008 2009 2010- 2012 25 25 EPS and ROE declined with lower net income Earnings per Share (in P) Return on Equity 100.00 25% 22% 80.92 76.74 80.00 20% 19% 60.00 15% 40.00 10% 20.00 5% 0.00 0% 2004 2005 2004 2005 Divid
Slide 14: First Semi-Annual Cash Dividend: P20 per share
First Semi- Semi-Annual Cash Dividend: P20 per share !Record Date : 21 February 2006 !Payment Date: 15 March 2006 ! Consistent with cash dividend policy of distributing 50% of prior year’s net income 27 27 14